By
Derek Hamilton
September 10, 2024
Artificial intelligence (AI) continues to be a focus for markets, and companies associated with AI have tended to outperform the rest of the market recently. Behind this excitement is the massive spending associated with the buildout of AI in the global economy.
Today’s chart looks at spending trends in this area, specifically data centers, which are facilities housing equipment used for the remote processing of large amounts of data. Data centers and the associated equipment are central to the future use of AI, and as AI adoption expands, the amount of data needed should continue to explode. As you can see from the chart below, spending on data center structures has grown exceptionally, with the latest figures showing a year-over-year growth rate of more than 60%. This far exceeds total construction spending of roughly 7%. The annual spend rate for data centers has jumped to more than $27 billion, roughly tripling in the last three years.
Despite exceptional growth rates, data centers are a small piece of the overall economy. However, rapid growth and the potential economic benefits from AI cannot be ignored.
Private nonresidential spending on data center structures
(year-over-year percent change, 3-month moving average)
Sources: Macquarie, Macrobond, US Census Bureau.
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